Courts generally accept stipulated protective orders proposed by the parties. In federal courts, there is a prevailing conception that “sharing clauses” are frowned upon, in line with the usual prohibition on sharing discovery in one case with other cases. “Sharing clauses” can be found in stipulated protective orders authorized by the courts.
However, it has been observed that federal courts disfavor sharing clauses. This observation was made by a U.S. Magistrate Judge in a case in which she refused to authorize a sharing clause.1 In an opinion that may inadvertently become a guide for parties and their lawyers to make a showing in federal courts as to why a sharing clause should be given effect, the Magistrate Judge wrote in such a way as to illustrate two ways in which such a showing might be made successfully. Careful readers of court opinions will see this right away when they read the opinion in this case.
The first way lies in the decided case law analyzed by the Magistrate Judge to the effect that the courts have authorized the use of sharing clauses when the party seeking to share has made a showing that the discovery in question is “highly relevant to other litigation,” and so sharing the subject discovery among different cases would have the following salutary effects that might be attractive to a federal judge:
- avoiding duplication;
- promoting efficiency;
- minimizing discovery costs, and
- conserving judicial resources..”2
The second way of making such a showing in a case in federal court suggested by the Magistrate's opinion is to "articulate[] specific ways in which the sharing of information could be useful to this case."3 There may be overlap between these two ways of making a successful showing that a sharing clause is desirable in a given case, but the second way mentioned here allows the possibility of other proofs besides those at work in the first way.
[1] SRH Holdings, LLC v. Gov't Emp's Ins. Co., No. 23-10325-DJC, 2024 WL 51279, at *1 (D. Mass. Jan. 4, 2024) (Boal, USMJ).
[2] SRH Holdings, 2024 WL 51279, at *1.
[3] SRH Holdings, 2024 WL 51279, at *2.
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